This document provides information on financial action steps and milestones for different ages and stages of life. It outlines recommended financial tasks in your 20s such as learning to invest, budget, and pay off student loans. Financial tasks in your 30s include saving for retirement and buying a house. Milestones include having 6 months of savings by age 30. The document recommends savings targets at different ages and notes financial considerations for those in their 50s, 60s, and beyond.

1. Financial Action Steps
and Milestones for
Different Ages and
Stages of Life
Barbara O’Neill, Ph.D., CFP
Extension Specialist in Financial Resource Management
boneill@njaes.Rutgers.edu
@moneytalk1

2. IFL Attendees Are at Many
Ages and Stages of Life
Source: David Lerner Associates’
Guide to Smart Retirement
Strategies, David Lerner
Associates, Inc., Syosset, NY
Source: Wall Street Journal:
https://www.wsj.com/articles/analysis-of-the-
generations-isnt-an-exact-science-1468575000

3. Generation Definition

4. The Influence of Early
Environments
“What imprints on younger people impacts them for the
rest of their lives”
Cam Marston, Generational Insights
https://generationalinsights.com/about/
4

5. Generational Differences
Source: Dr. Ethel
G. Jones,
Louisiana Tech
University, School
of Human Ecology

6. Source: Merrill
Edge Report,
spring 2017:
https://olui2.fs.
ml.com/Publish/
Content/applica
tion/pdf/GWMO
L/Merrill_Edge_
Report_Spring_
2017.pdf

7. Source: Next Gen Personal
Finance:
https://docs.google.com/prese
ntation/d/1-
2R_jszVMwlVW2mUvrnPM-
EFo6GqhIpRIK9z1LfuinE/edit
#slide=id.g1821408edd_0_0

8. Cash Asset Allocation
Source: Blackrock
survey via Investopedia:
http://www.investopedia.c
om/news/millennials-are-
risk-averse-and-
hoarding-cash/?lgl=rira-
baseline-vertical

9. Auto Insurance Premiums By Age
Source: Value Penguin via Next Gen Personal Finance:
https://docs.google.com/document/d/1sgTUFbCvNyUbEyAiIiUNsXIAxX9PD
4OSoACjt0xzczE/edit

10. Source: Value Penguin via Next Gen Personal Finance:
https://docs.google.com/document/d/13kyHDBg91oCZUzmWip7PRCi9CUm
FDmg89d1kXHBkuLM/edit

11. Multi-Generational
Housing Arrangements
Source: Next Gen
Personal Finance:
https://docs.googl
e.com/presentatio
n/d/1RgiqeOwXdA
6_HsyjhTyKhq1S5
1tB3GOj0kInQsItL
h4/edit#slide=id.g
99918596f_0_129

12. Young Adults Living With Parents
Source: Pew Research
Center:
http://www.pewsocialtrend
s.org/2016/05/24/for-first-
time-in-modern-era-living-
with-parents-edges-out-
other-living-arrangements-
for-18-to-34-year-olds/

13. The Financial Life Cycle
1
3
Source: Take
Charge Today,
formerly
known as
Family
Economics
and Financial
Education
(FEFE)

14. Financial Tasks in Your 20s
• Learn to invest
• Learn to budget
• Start a 403(b) retirement savings plan
• Pay back student loans
• Build a good credit history
• Build an emergency fund

15. Financial Tasks in Your 30s
• Save as much as possible in retirement plans
• Buy a house, if desired and not done already
• Build your investing expertise
• Diversify your investments
• Boost your job skills
• Prepare basic estate planning documents
• Start an investment account for children

16. Financial Tasks in Your 40s
• Max out retirement savings, if possible
• Consult with financial advisors, if needed
• Maintain adequate insurance and emergency savings
• Review and/or update estate planning documents
• Talk to your aging parents about their finances

17. Financial Tasks in Your 50s
• Ramp up savings in peak earning years
• Rough out how much money you’ll need to live on
after you leave RCE
• Pay off all of your debts except a low-rate mortgage
• Consider buying a retirement or vacation home
• Educate yourself about Social Security, your
retirement savings plan, and long-term care costs
• Start preparing for your “next act”

18. Financial Tasks in Your 60s
• Start collecting Social Security
• Cash in on senior discounts
• Purchase LTC insurance or earmark a portion of
savings for LTC insurance
• Educate yourself about Medicare and required
minimum distributions at age 70 ½
• Get more strategic about charitable gifting
• Prepare yourself psychologically for the “withdraw
and spend” phase of life

19. Financial Milestones by Age
1
9
Source:
https://moneytalk
1.blogspot.com/2
017/07/personal-
finance-tasks-by-
decade.html

20. Age 30
• Financial independence from parents (e.g., independent living
arrangements and no “subsidies”)
• Student loan debt completely repaid or close to repayment (e.g.,
standard 10-year repayment plan)
• A half-year’s worth of salary saved for retirement
• A good credit history established with a credit score in the low- to
mid-700s or higher
• Regular saving/investing and at least three to six months of
income set aside for emergencies
• Educational credentials earned or near completion (e.g.,
certifications and graduate/professional degrees)
• Have current estate planning documents and life insurance to
protect dependents or co-signers, if applicable

21. Age 40
• Two times annual salary saved for retirement; saving at
least 10% of gross income (15%+ is better!)
• College savings established for children, if applicable
• Increased investing expertise and diversification of
investment portfolio assets
• Increased human capital (i.e., job skills and knowledge) to
remain employable and earn promotions/raises
• Continued adequate insurance (life, property, disability)
• Career advancement

22. Age 50
• At least 4 to 6 times annual salary saved for retirement
• Making catch-up retirement savings plan contributions
• Increased knowledge about the specifics of Social Security,
Medicare, and employer retirement benefits
• Increased knowledge of aging parents’ finances and
communication about caregiving-related issues
• Use of financial advisers, as needed, as net worth
increases and finances become more complex
• Continued adequate insurance (life, property, disability)
• Career advancement

23. Age 60
• At least 6 to 10 times annual salary saved for retirement
• Paid off mortgage, home equity loan, and credit card debt
prior to retirement
• Catch-up retirement strategies used, if needed (e.g.,
downsizing, moving, working longer, and selling assets)
• Learning new skills and/or making other preparations to
transition to a “second act” job or volunteer role
• Use of financial advisers, as needed, as net worth
increases and finances become more complex
• Continued adequate insurance (life, property, LTC)

24. Recommended Benchmarks
Source: T. Rowe Price
Investor, Spring 2017, p. 9
Source: Fidelity
Investments:
https://bucks.blogs.nyti
mes.com/2012/09/12/s
uggested-retirement-
savings-goals-by-age/

25. Don’t Forget Generation Z!
Video:
https://www.youtube.com/watch
?v=K1HyDn7dZ1o
Born 1994-2010 (approx.); next cohort of future employees
Video:
https://www.youtube.com/watc
h?v=I7N1JJo6eFg

26. Gen Z Take-Aways
• Make up 25 percent of U.S. population
• Realistic thanks to skeptical Gen X parents, recession
• Competitive with “do it yourself” mentality
• 74% prefer to communicate face-to-face
• 75% say there are other ways to get a good education
than going to college
https://www.inc.com/ryan-jenkins/generation-z-vs-
millennials-the-8-differences-you-.html

27. Journal of Financial
Planning Blog Post
Source:
https://practicemana
gementblog.onefpa.
org/2017/06/27/be-a-
gen-savvy-planner-
take-off-your-
generational-lenses/

28. Key Take-Away: Don’t
Impose YOUR “Social Clock”
on Other People!
Social Clock- “a cultural timeline of expectations of what
people should do at a certain age” (William Doherty, U of
Minnesota)
– Late 20s/30s: “So when are you two going to have a baby?”
– Late 50s/60s: “So when are you going to retire?”
– Late 60s/70s+: “Are you still working? Why?”
https://www.wsj.com/articles/its-ok-to-party-when-you-turn-60-1500914273
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